A brand new vehicle loan could be less expensive than buying used

As the auto industry undergoes a profound transformation, new vehicles may be a much better investment than pre-owned automobiles. Interest rates and incentives for brand new autos have created situations where time-honored advice on automobile purchases may not apply. Certain makes and models cost less per month brand new than the same car driven for a year by a previous owner. This makes it easier than for those who take out installment loans for their cars. Source for this article – New cars are cheaper than used cars in an upside-down economy by MoneyBlogNewz.

What all of the free funding auto loan companies are offering

You may have quick money to pay for your automobile. However, if you do not, it’s a better idea to get a loan for a brand new auto than a used one sometimes. The recession brought on loan rates to go down a lot. That means that they’re still just as low for brand new vehicles. Edmunds.com accounts that 4.16 percent in Dec. was what the average auto loan was in December. Strangely enough, more than 15 percent of auto loans are virtually devoid of interest. After the government bailout helped a ton, General Motors is now doing well. In fact, of all the auto loans offered by the company, 50 percent of them have 0 percent financing. You’ve to have worked for the 0 percent funding. Not everyone is able to get it. Strong credit is needed to qualify for such a sweet deal, to the tune of a FICO score of at least 650 and sometimes above 700.

Having cheaper brand new vehicles than used cars auto

There’s a 4 percent average rate of interest for new automobiles currently. With used cars it is closer to 8 percent. The price gap between brand new and used vehicles is not there as much either. It has gotten smaller. The "cash for clunkers" program in 2009 cleared the market of about 700,000 used vehicles. The financial crisis and credit crunch that hit brand new car sales so hard affected the amount of used vehicles being traded in. With the way a new automobile is made to have such cheap deals with a five year loan, a one year old automobile is probably going to be more expensive than a new model.

The less expensive brand new automobiles

There was a goal in mind at Edmunds.com of making a list of new cars cheaper than used vehicles. In order to do this, the 0 percent brand new vehicle interest rate was compared to a 7.7 average used-car interest rate. Auto loans were for five year terms, and other incentives were figured in. Some of the automobiles on the list contain the Audi S4 Premium Plus Quattro Sedan, with a savings of $1,020; the Honda CR-V EX with a savings of $1,320; and the Toyota FJ Cruiser base model, also with a savings of $1,320.

Information from

Market Watch

marketwatch.com/story/story?Guid=94f611d3-aa3c-4b21-b432-90910a50e8e0

Money Watch

moneywatch.bnet.com/saving-money/blog/cars-money/flash-new-cars-cost-less-than-used-cars/460/

Edmunds.com

edmunds.com/car-news/new-vs-used-car-buying.html